Aims to build a plus 100M ounce silver mine developer with projects which remain cost positive at US$16
Creating a junior company, which is highly leveraged to silver price
Potential for a re-rating following low risk resource development drilling
What Aftermath Silver does:
Toronto-listed Aftermath Silver Ltd (CVE:AAG.H) describes itself as a junior explorer focused on acquiring, exploring, and developing silver projects with an emphasis on Chile in South America.
The company says it's also always on the lookout for new opportunities to take advantage of the relatively low silver price currently. It wants to attract the market by amassing over 100 million ounces of silver with a portfolio of projects that remain 'cost positive' at around US$16 per ounce of silver (current price: around US$18.5).
The firm also aims to buy advanced projects that are underpinned by existing resources.
So what are its assets:
The company's Challacollo project in Region 1, Chile already boasts a historic NI 43-101 resource estimate from 2015 of 4.7 million tonnes for 30.2 million ounces of contained silver at a grade of 200 g/t and 48,400 ounces of gold at 0.32 g/t in the higher confidence indicated category.
In the lower confidence inferred section there is 1.6 million tonnes for 6.9million ounces of silver and 15,900 ounces of gold at a grade of 134 g/t and 0.31 g/t respectively. It lies 30 km east of the Pan American Highway.
The company notes that only the Lolon vein at the project is included in that previous resource and that on that vein, metallurgical recoveries were 92% silver and 75% gold.
Aftermath must pay the vendor (Mandalay Resources (TSE:MND)) a total of C$7.5 million to acquire 100% of the project. Mandalay retains a 3% NSR (net smelter return) on production up to C$3 million.
That reportedly works out at about C$0.20 an ounce or about 1% of the value of the silver in the ground.
Aftermath's second Chile project is called the advanced Cachinal property, in Region 2, and it has a current NI 43-101 silver resource of just over 22 million ounces.
It struck a definitive agreement with Halo Labs Inc (formerly Apogee Opportunities Inc) to purchase its 80% stake in the property, which lies around 40 km east of the Pan American Highway.
The company is paying a total of $3 million for the project over a three-year period. That works out at about C$0.15 per ounce of silver.
Metallurgical recoveries are 85% for silver and gold using simple direct cyanidation processing. There is a mill around 10 miles away said to make the resource economic at the current silver price.
Notably, Austral Gold's (ASX:AGD) Guanaco mine lies 16km to the south of the project, which has produced around 49,000 gold equivalent ounces per annum over the last four years.
How's the company doing:
Earlier this month (September) the firm announced a non-brokered private placing for up to 15 million units at C$0.20 a throw to raise C$3 million to advance the two projects. That was in addition to an increased placing announced in July to raise C$2.5 million for the "acquisition and exploration" of the two properties.
On September 10, the company named experienced mining executive Ralph Rushton as the group's new CEO, president and director, while Michael Williams remains chairman.
For the last 16 years, Rushton has worked in business development and marketing for several junior mining firms and currently serves as a director for three TSX Venture Exchange companies and is an advisor to two other exploration companies.
He has helped to raise more than C$400 million through equity financings to fund exploration and development in Latin America, Scandinavia and Eastern Europe.
Work programs
At Challacollo, immediate plans include resource development drilling on the Lolon vein's hanging wall and footwall parallel structures and low grade halo mineralization, and to continue with project development activities.
Meanwhile, at Cachinal, the firm's plans include developing revised long sections for each vein and down dip drilling targeting high grade ore shoots below open pit shells and to advance metallurgical leaching test work.
Potential inflection points
Start of work programs
Newsflow from work
Silver price changes